EUR sees little reaction to ECB Minutes

Minutes from the latest  ECB meeting have just been released, however did not cause any major moves on the market as discussions took place 3 weeks ago, followed by the publication of a number of important economic data, therefore views included in the documents are somewhat outdated.

• Better than expected growth outlook would contribute to continued inflationary pressures, which were unlikely to abate by themselves without further significant policy tightening.

• Members agreed that there were no signs of a wage-price spiral, though wage pressures were broadening.

• To gauge underlying inflationary pressures, markets are now paying more attention to core inflation rather than headline inflation.

•  It was noted that the short-term momentum in core inflation had also started to decline somewhat.

•  The underlying situation is not very different from December.

• Reservations were expressed on the proposed communication of an intention for the March meeting.

• The recent developments are in line with a `soft landing'.

• The view was expressed that there continued to be value in frontloading rate hikes at the present stage.

• Further increases were required for the governing council’s policy rates to enter restrictive territory.

EURUSD is rather unimpressed by ECB Minutes. The pair continues to trade around 1.0620 level. Source: xStation5